State govt guilty of VAT scam: HDK

Addressing a press conference, Kumaraswamy said the State Government had, with the concurrence of the Centre raised the VAT rate by 1 per cent in 2009 to fund the “Aasare” scheme.

However, it had, without informing the Centre, continued the hike for a second year, collecting Rs 6,000 crore, and diverting the funds to purposes other than the rehabilitation of the flood-hit.

“During 2009-10 and 2010-11, the governement raised VAT on essential commodites from 12.50 per cent to 13.50 per cent, raising Rs. 6,000 crore,” Kumaraswamy said.

Although the Centre had permitted the VAT hike for a year, the increased VAT was being continued to be collected, he claimed.

“While collecting such a huge sum, Yeddyurappa had cheated both the public as well as the flood-hit who were not provided homes by the Government,” Kumaraswamy said.

“With the money collected through VAT, and from the donors who contributed hundreds of crores of rupees, each flood-hit family could have been provided with a house built at a cost of not less than Rs two lakh, but the dwellings they  get are no better than kennels,” Kumaraswamy remarked.

The former chief minister said he would draw the attention fo the Centre to the “illegal” continuance of VAT by the State government.

He said it was an irony that the BJP which had contributed to inflation by increasing VAT, was claiming to agitate against price rise.

He said the JD(S) would launch a State-wide agitation if B S Yeddyurappa did not cut the VAT in budget he would be tabling on Thursday.